HEALTH CARE
QUALITY ACT OF 1997
Following more than two
years of conflict and compromise, Governor Christine Todd Whitman signed the Health Care
Quality Act in August, 1997. The legislation clearly delineates the rights and
responsibilities of both the insured and the companies providing health care coverage. An
estimated 3.5 million New Jersey residents are enrolled with managed care organizations
(MCOs).The
measure prohibits carriers from giving health care providers financial incentives to
withhold medically necessary services, bars "gag clauses" and protects
providers' ability to discuss with patients all appropriate diagnostic testing and
treatment options.
The legislation requires
insurers to provide subscribers with easily understood descriptions of covered services
and the limitations on those services. It further requires an appeals process be provided
if coverage is denied and establishes an appeals program within the state Health
Department to review final decisions by carriers to deny, reduce or terminate benefits.
There also is a ban on any retrospective benefits denial.
Financial incentives between
MCOs and participating providers are required to be disclosed, along with information
about the MCOs' standard for customary waiting times for appointments and the availability
of independent consumer satisfaction survey results. The law requires that a licensed
physician must be responsible for establishing treatment policies and protocols and for
making utilization management decisions for MCOs.
Additionally, the
legislation includes a number of provisions that protect health care professionals. It
requires carriers to give providers 90 days' written notice prior to terminating their
contracts, inform the provider of the reason for the termination on request and hold a
hearing within 30 days should a provider want to appeal the termination.
Many of these safeguards
were included in the new rules governing health maintenance organizations (HMOs) that the
Department of Health and Senior Services adopted in February, 1997. However, the
legislation extends those protections to subscribers covered by MCOs other than HMOs (an
HMO is just one of many forms of MCOs), and also strengthens the rules by creating a
statute which has greater force and effect than regulations that can be rescinded or
amended without legislative authority. |
